Correlation Between American Express and CONSTELLATION
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By analyzing existing cross correlation between American Express and CONSTELLATION BRANDS INC, you can compare the effects of market volatilities on American Express and CONSTELLATION and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in American Express with a short position of CONSTELLATION. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and CONSTELLATION.
Diversification Opportunities for American Express and CONSTELLATION
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and CONSTELLATION is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding American Express and CONSTELLATION BRANDS INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CONSTELLATION BRANDS INC and American Express is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on American Express are associated (or correlated) with CONSTELLATION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CONSTELLATION BRANDS INC has no effect on the direction of American Express i.e., American Express and CONSTELLATION go up and down completely randomly.
Pair Corralation between American Express and CONSTELLATION
Considering the 90-day investment horizon American Express is expected to generate 0.44 times more return on investment than CONSTELLATION. However, American Express is 2.25 times less risky than CONSTELLATION. It trades about 0.29 of its potential returns per unit of risk. CONSTELLATION BRANDS INC is currently generating about 0.05 per unit of risk. If you would invest 27,147 in American Express on August 28, 2024 and sell it today you would earn a total of 3,374 from holding American Express or generate 12.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 71.43% |
| Values | Daily Returns |
American Express vs. CONSTELLATION BRANDS INC
Performance |
| Timeline |
| American Express |
| CONSTELLATION BRANDS INC |
American Express and CONSTELLATION Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and CONSTELLATION
The main advantage of trading using opposite American Express and CONSTELLATION positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, CONSTELLATION can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in CONSTELLATION will offset losses from the drop in CONSTELLATION's long position.| American Express vs. SLM Corp | American Express vs. Orix Corp Ads | American Express vs. FirstCash | American Express vs. Medallion Financial Corp |
| CONSTELLATION vs. The Coca Cola | CONSTELLATION vs. JPMorgan Chase Co | CONSTELLATION vs. Dupont De Nemours | CONSTELLATION vs. Alcoa Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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